NuMBBR  iS, 


A.  T).  1830.3 


OK 


INCORPORATING 


THB 


li 


RALEIGH: 

««CNT£I>  BT  LATTRENOE  &  LSlUfl; 
Printers  to  tke  States 


I8S0 


REPORT 


rhe  Comuiittee  to  whom  was  referred  the  censideration  of  a  Bill  fo  incor* 
porate  the  Mecklenburg  Gold  Mining  Company,  respectfully  report  that 
they  have  considered  the  same: 

Firsty  As  it  respects  the  interests  of  the  individuals  themselves,  who  ap- 
ply for  acts  of  incorporatiori,  or  of  those  who  afterwards  become  their  h^so- 
ciates;  and  in  this  view,  whether  the  advantages  proposed  to  be  attained  by 
persons  engaging  in  ndning  enterprises  can  be  more  t  ffeciually  attained 
through  corporate  associatious,  or  whether  they  can  possibly  be  attained  ia 
any  other  way. 

Your  committee  have  next  considered  how  far  private  interest  and  advan» 
tage  might  be  consistent  and  in  conformity  with  the  public  interest,  and 
whether  it  be  sound  State  policy  to  extend  a  fostering  hand  over  mining  un- 
dertakings in  every  instance,  and  in  every  manner  not  inconsistent  with  the 
public  good. 

Your  committee  believe  it  is  well  known  that  mining  enterprises  are  rare- 
ly prosecufed  by  persons  singly,  even  in  those  countries  where  private  for- 
tunes are  overgrown;  and  that  in  this  country,  where  property  is  happily  en- 
joyed in  nn  re  equal  distribution,  several  private  foriunes,  here  esteem  d 
large,  would  together  be  insufficient  to  form  and  conduct  a  mining  establish- 
mem  extensive  enough  to  be  in  the  highest  degree  profitable.  This  arises  in 
pari  !Vom  the  heavy  outlays  required  for  mills,  machinery,  and  houses  for 
w(»ikmen,and  the  salaries  of  numerous  ofFicers,  who,  from  the  na'ure  of 
their  duties,  are  highly  paid;  and  in  pirt  it  arises  from  the  peculiarly  uncer- 
tain and  hazardous  character  of  a  business,  in  which  the  wliole  capital  em- 
ployed may  be  sunk,  and  on  which  no  insurance  can  be  effected  as  upon  a 
ship  lost  ai  sea,  or  a  building  destroyed  by  lire.  Workers  of  mines  should 
command  capitals  so  large  as  to  make  them  in  effect  their  own  insurers,  or 
the  risks  should  be  divided  among  many.  The  hazards  of  mining  are  pro- 
verbial in  all  countries,  and  the  English  call,  expressively,  those  embarking 
in  it  adventurers. 

It  must  be  expected,  and  it  has  already  boen  experienced,  that  in  North 
Carolina,  as  in  other  mining  countries  without  exception,  the  most  sanguine 
liopes  will  be  disappointed,  and  calculations  the  wisest,  and  (tie  luo^f  w,»r- 
rantcd  by  appearances,  will  be  found  false  or  exagsjerated  in  their  resul.s; 
and  that  true  prudence  requires  that  persons  should  embas  k  in  mining  en- 
terprises only  such  sums  as  they  can  sacrifice  without  deranging  their  for- 
tunes. 

It  is  at  the  same  time  obvious  to  your  committee,  that  the  receipts  or  pro- 
fits of  a  given  mining  establishment  are  by  no  means  prop<viMiof)ate  to  ihe 
current  expeuses.  What  may  be  called  thf^  nkele'on  of  ar*  e  i'dtjlishmeoi- 
that  is  the  director  of  the  mine,  the  chief  nnner  and  Kubordih  iie  offic  js,  all 
necessary  for  strict  regularity  and  economy  the  head  mi  I  wright,  the  bla'  k- 
smith,  the  engineer,  &c.  essentially  requisite  for  an  esiabiisiiment  employ- 
ing only  one  hundred  and  fifty  or  two  hundred  laborers,  cnt'  as  much  as 
they  would  in  an  establishment  which  should  employ  500  ;  only  differ- 
ence bein»  betv/een  the  v/ages  of  a  larger  or  smaller  number  t>f  ravre  la- 
borers at  low  rates,  and  who  can  b(*  discharged  or  increa*it'?J  as  circuns- 
stances  justify,  while  the  more  burdensome  expenses  remain  constiinC  an*^^ 
"  'diminished. 


4 


These  considerations  have  led  your  committee  to  the  conclusion  that  the 
mines  of  this  State,  as  those  of  other  countries,  ought  to  be,  and  will  be 
worked  by  persons  associated  tog:ether,  not  as  individujils  on  their  own  ac- 
count And  it  further  appears  to  them,  that  the  only  two  modes,  by  which 
individuals  can  become  associates  for  mining  purposes,  ar*5  by  way  of  co- 
partnership and  by  way  of  corporate  bodies. 

It  is  urged  upon  your  committee,  with  apparent  reason,  by  those  interest- 
ed in  raining  property,  that  the  legal  liabilities  incident  to  copartnerships 
are  so  many  and  so  great,  especially  when  joined  to  the  risks  of  mining,  as 
to  deter  most  capitalists  from  investing  money  in  mining  operations,  as  they 
would  do  were  they  exempted  from  liability  of  copartnership  and  exposed 
to  mining  risks  alone.  There  are,  for  example,  many  persons  in  this  State, 
in  the  other  United  States  and  in  Europe,  who  are  desirous  of  appropriating 
to  mining  enterprises  sums  from  100 dollars,  up  to  some  thousands  of  dol- 
lars, were  there  any  assurance,  in  case  the  adventure  should  be  unsuccesg 
ful,  that  they  would  be  involved  no  more  than  in  the  loss  of  the  specific  sum  ap* 
propriated.  But  in  copartnership  associations,  no  person  can  have  such  as- 
surance, because  if  he  be  interested  in  the  concern,  although  but  in  the 
one  thousandth  part,  or  in  a  less  part  of  the  profits,  he  will  be  responsible  foe 
all  the  debts  of  the  copartnership,  and  if  his  partners  are  insolvent,  will  be 
compelled  to  pay  the  whole  amount  of  debts,  though  he  never  can  enjoy  but 
a  very  insignificant  share  of  the  profits.  So  that  an  individual  who  puts  into 
the  capital  of  a  copartnership  any  sum,  however  large  or  however  small,  can- 
Hot  say  he  will  risk  no  more,  because  his  whole  fortune  &  his  liberty  itself  are 
afterwards  risked  inevitably.  When  the  place  of  business  is  far  distant 
from  the  residence  of  the  monied  partners,  their  situation  becomes  still  more 
perilous,  because  in  addition  to  other  causes  of  ruin,  they  may  remain  along 
time  uninformed  of  an  injudicious,  an  extravagant  or  destructive  management 
gf  the  acting  partner.  That  man,  however  rich,  who  places  but  the  smallest 
amonnt  in  an  extensive  tnining  undertaking,  may,  with  every  circmnstance 
prosperous  one  day,  the  next  be  worse  than  poor,  by  the  burning  of  the 
fortifications,  a  sudden  rush  of  water,  or  other  of  the  numerous  casualties, 
which  have  80  often  blasted  the  best  founded  expectations,  and  against  which 
no  prudence  can  provide.  Your  committee  cannot,  therefore,  doubt  that  it 
is  only  asa  meroberot  abody  corporate,  that  the  responsibilities  of'an  individu- 
al, who  engages  ever  so  little  in  a  mining  enterprise,  can  be  limited,  while,  as 
a  member  of  a  corporation,  he  is  only  responsible  to  such  amount,  small  oi" 
great,  as  he  may  upon  full  deliberation  conclude  upon  risking. 

It  is  likewise  a  highly  important  incident  of  corporations,  that  the  rights, 
shares  or  stock  admit  of  being  easily  transferred,  &  no  responsibility  continues 
to  encumber  the  seller  afterwards;  whereas  a  transfer  of  copartnership  rights 
dissolves  the  association,  and  does  not  divest  the  transferrer  of  his  liability 
even  for  subsequent  debts  of  the  copartnership  unless  notice  of  a  dissolution 
is  brought  home  to  the  creditor.  In  copartnership  associations,  the  death, 
insanity  or  incapacity  of  either  party,  however  numerous  the  association, 
will  be  a  dissolution  of  the  partnership.  New  and  complicated  rights,  in- 
terests and  duties  immediately  succeed,  so  that  when  the  capital  of  a  Con- 
cern has  been  derived  from  many  sources,  there  is  scarce  a  possibility  of  its 
long  duration,  even  with  every  legal  provision  for  that  purpose.  On  the 
other  hand,  corporators  succeed  to  each  other  perpetually,  and  by  a  con- 
cpBtrated  authority  in  directors,  a  uniform  and  systematic  adfi}!ftistratii5r 


of  business  may  be  thus  persevered  in  for  any  given  period.  Your  commftt-^tj 
ire  fi;  h<  r  pinion  diat  as  stoc  kholders  in  a  chartered  companj,  far  bet' 
er  by  'Avy  ;,s  i^U'on  of  '  opartnership,  the  citizens  of  this  state  cao 
va;i  i!  enjseUes  of  rhe  advrtf-  .iges,  a  residence  in  the  countrj  gives,  to  buy 
r  se'i  out  stock  in  the  lii  vv  rent  companies,  aJ?,  from  their  opportunities  for 
bservatioRj  a  d  n  enterprise  weU  or  iil  conducted  anjl  of  favour- 
tible  or  unfdvowiabitt  prospects;  thus  putting  to  a  profitable  use  $:uch  sumft 
as  tlieir  disposition  and  abi'i  j  m.\y  induce  them  to  risk.  The  stock  of 
chartered  mining  companies  wiil  of  course  be  otfered  in  market,  it  being  one 
object  in  the  creation  of  8(ock  for  mining  undertakings,  to  derive  a  profit 
tVoai  its  rise  in  value,  as  vvi^H  as  a  profit  from  the  mines  themselves;  so  that 
il  will  be  always  open  to  the  resident  citizens  to  invest  larger  or  smaller 
gams  in  the  funds,  and  acquiring  from  their  local  position  as  from  a  vantage 
ground,  immediate  and  correct  intelligence  of  the  progress  of  the  business^ 
mining  stock  more  than  any  other  stock, *and  to  them  more  than  to  others  at 
a  distance,  will  become  a  fertile  field  of  speculation,  and  this  secure  from 
the  ruin  incurred  by  partnerships.  Your  committee  are  of  opinion  that  the 
example  and  usage  of  other  mining  countries,  who  in  different  ways  provide 
against  associate  responriibilities  extending  beyond  a  fixed  limit,  and  virtual- 
ly confer  on  mining  companies  corporation  privileges,  are  not  to  be  disre- 
garded. They  beg  leave  to  cite  an  instance  strongly  illustrative  of  what 
has  been  said  upotj  the  subject  of  parutership  associations  for  mining  purpo- 
ses: l%is  well  known  that  sevtrral  Kugiish  mining  companies  in  Mexico, 
within  a  few  years  past,  have  dij'continned  tiieir  operations  under  rcputatioft 
of  having  failed  irom  extravagance,  bad  management,  working  bad  mine?, 
&c.  There  probably  was  much  extravagance  and  much  bad  management  in 
the  early  stages  of  tlieir  undertakiiigs;  but  the  true  causes  of  the  failurefand 
dissjiiution  of  one  or  two  at  least,  which  were  proceeding  under  favofable 
prosp.-'.rs,  are  not  generally  known,  and  are  said  to  have  been  somewhat  n% 
ifollowsi  In  Mexico,  the  mining  ordinances  promulgated  by  a  succession  of 
Kings,  sensitively  alive  fo  the  vital  importance  of  the  mining  interests, 
corrof  ted  by  :h;^  experience  of  ages  and  the  exigencies  of  cases  which  hat! 
occurred  and  b^en  reduced  to  form  by  the  ablest  jurist,  have  become  a  code, 
which,  far  its  liberal  policy,  its  subtle,  yet  clear  definitions,  its  adaptation 
to  all  supposable  cjses,  its  substantial  justice  between  persons,  is  not  sur- 
passed by  any  human  monument  of  legistative  wisdom.  By  its  provi- 
sions a  kind  of  limited  copartnership  is  sanctioned,  by  which  the  risk  -  ach 
associate  is  to  run  may  be  specifically  fixed,  and  by  a  legal  distribution  of 
each  mine  into  an  artiiicial  division,  called  barras  or  shares,  all  the  valu- 
ble  privileges  of  incorporation  are  secured. 

Itis  a  co'i'^equence  in  law,  that  atl  contracts  m;ide  in  Mexico  are  governed 
by  the  laws  of  the  country,  and  two  or  three  English  companies  now  in 
stable  prosperity,  and  yielding  great  returns,  had  the  foresight  to  make  every 
engagement  in  Mexico  by  which  the  associates  were  secured  against  an  un- 
limited hazard.  Other  companies,  less  prudent  &  sagacious,  made  similar 
contracts  in  form,  but  executed  in  London,  so  that,  being  partners,  each 
and  every  memb^'r  of  them  became  responsible  for  all  indebtedness  of  the 
company  The  stock  or  interests  muc  h  distributed  in  the  community,  and 
a  large  part  held  by  irresponsible  persons,  while  perhaps  a  minufe  interest 
was  in  the  hands  of  a  wealthy  banker  or  of  some  nobleman,  who  thought  to 
sport  Bome  pounds  as  upon  a  letter;  ticket^,  not  dreaming  of  having  i*ncur- 


6 


red  the  heavy  liability  o[  tvery  debt  and  of  involving  immense  loi  tunes  ii]  a 
distant  and  uncertain  adventure.  When  aware,  after  some  rime,  of  their 
situation,  it  becam«  an  act  of  sclf  protection  to  stop  all  further  expendi- 
tures, that  their  liabilities  might  go  no  further  ttiaii  were  already  iiicuried; 
which  was  done,  the  rights  were  bouglit  up  at  a  discount,  and  the  associa- 
tions were  dissolved  under  colour  of  u.ifortunate  specularii>ns. 

Your  committee,  tlierefore,  under  conviction  that  mining  establishments, 
large  enough  for  the  fuiiest  profits,  cannot  be  furmed  nor  supported  by  in- 
dividual capital,  are  at  the  same  time  persuaded  that  by  partnership  asso- 
ciations, it  will  be  ditlicult,  if  not  impracticable,  for  the  owners  or  vvoikers 
to  concentrate  from  the  citizens  of  this  State,  or  to  attract  hither  f  jreign 
capital,  in  amounts  at  all  proportionate  to  her  rich,  ample  and  virgin  field 
of  mineral  treasures. 

The  labor   and  money  hitherto  bestowed  upon  the  mines  in  this  State 
can  be  regarded  in  no  other  iiglu  than  as  bestowed  in  mere  experiment,  tu 
ascertain   ifa  nev/  mining  country  would  justify  the  introduction  of  larger 
investments  and  more  systematic  operations.    The  result  has  pcoved  fa- 
vorable,   beyond  expectatio  ),  and  tl-a  Vvorld,  which  was  only  three  years 
since  increduious  and  jeerif:;^  now  acivnits  that  gold  is  found  in  North  Car- 
olina.   Ignorantly,  irregula;  sy,  v/f.stefully  and  parsimoniously,  as  money 
and  labor  have  thus  far  bet;!  applied,  your  committee  have  heard  no  esti- 
mate-rating the  produce  ci  ae  mints  of  this  Stale  at  an  amount  less  than 
500,000  duUars  for  the  prescat  year,  ending  in  January  next./  To  a 
State  wiUiout  foreign  commerce,  for  want  of  sea-ports,  or  a  staple,  without 
internal  communications  by  rivers,  roads  or  canals — without  a  cas>h  home 
market  for  any  article  of  agricultural  produce — without  manufactures — in 
short,  without  any  ot-ject  to  which  native  industry  and  active  enterprise 
could  be  directed,  or  which  coulc*  oiler  a  stimulus  to  exertiou — tlie  discove- 
ry and  developemeiit  of  her  gold  mines  are  events,  whicii,  more  than  the 
lapse  of  inert  centuries,  will  advance  her  influence,  prosperity   and  happi- 
ness.   One  of  your  conimiltee  represents  a  prominent  mining  district,  arid  it 
is  tresh  in  his  recollection  that  the  citizens  of  Mecklenburg  were,  before  the 
opening  of  the  mines,  in  general  involved  in  debt,  seemingly  beyond  a  pos- 
sibility of  extrication.    Valuable  farming  possessions  were  sold  under  exe- 
cution and  under  trust  deeds  for  insignificant  pfices,  it  being  as  irixpractica- 
tle  in  many    instances  to  procure  50  dollars  as  500  dollars,  especially 
when  the  Bank  was  pressing  collections,  and  withholding  loans.  The 
sums  since  extracted  from  the  mines  by  the  native  population,  and  the 
sums  since  expended  by  adveniurers  for  mining  purposes,  have  materially 
changed  the  aspect  of  things.    'I'here  are  few  debts;  emigration  has  nearly 
or  quite  ceased;  land  has  grcitly  risen  in  real,  and  not  merely  nominal 
value;  and  there  is  a  spirit  of  conteniedness  and  honest  pride  in  the  inhabi- 
tants. There    an  increased  atteniinn  to  the  domestic  comforts  of  life,  a  rapid 
extension  of  education — jealousy  ol  foreigners  has  given  place  to  liberal  and 
friendly  feelings — mechanics  of  all  descriptions  receive  high  wages  and  con- 
stant employ — farmers  find  a  ready  and  cash  market  for  their  produce,  and 
there  is  not  known  to  be  any  class  of  wortuv  persons,  uptm  wnose  interest 
the  working  of  the  gold  mines  has  not  exerted  a  favorable  and  happy  in- 
fluence. I 

Your  committee  cannot  ascertain  that  any  of  the  evil  consequences  which 
were  predicted  as  the  inevitable  attendants  upon  gold  mining,  have  ensued. 


North  Carolina  has  not  been  impoverishet!,  but  enriched;  her  citizens  bav 
notbru)mf  indf'mt.  but  indusrrious;  intercourse  with  strangers,  if  it  has 
no-  in>pi  t"Vfd.  has  no<  coniaminated  the  native  population;  all  the  arts  of  ci- 
vilizpr  life  are  beginning  rapidly  to  be  appreciated,  and  innumerable  new 
paths  of  enterprize,  and  avenues  to  fortune  and  fame  are  now  opening  to  her 
youths  V 

Mining  operations  on  a  large  scale,  besides  miners,  indispensably  require 
the  aid  of  fheniists,  of  metallurgists,  of  mineralogists,  of  geojogists,  ^o* 
draughlsmrn,  ofTn^t-ers.  of  scientific  mechanics  of  the  highest  orderj  and 
surirvTili  be  rapidljHfo'  «ned  of  our  native  population,  whose  genius  and  ta- 
lent will  not  remain  latent,  after  high  lewai  ds  and  distinctions  are  offered 
for  thei'  developement  Iron,  both  cast.MliLwro«ght,  for  machinery  and 
other  uu^^  of  minin^r,  is  oT^such  extensive  and  constant  demand  and  con- 
sumptidi,  that  iron  works  sisuated  favorably  in  respect  of  veins  of  the  pre- 
cious mptals,  rannoT  but  yield  immense  incomes  to  energetic  and  managing 
pi(»piietor«  That  much  of  the  iron  of  this  Slate,  particularly  of  Lincoln,  is 
equ;*'  or  superinr  in  quality  to  any  known,  and  may  be  had  in  abundance 
ai>d  under  ves  v  fHvot  .ib'e  ( ircumstjinces  for  manufacture,  cannot  be  qnes- 
ti.  fuMl;  bu(  until  recently  tin  re  ha%  been  noindacement  fur  the  iron  masters 
to  fjtrm  expensive  establishment;?.  The  furnaces  and  forges  have  therefore 
bt  en  so  < « ntrai  ted  in  their  character,  so  unprovided  with  workmen  and 
neeolul  ma  hinery,  that  in  consequence  of  the  inability  to  procure  from 
thrm  engines,  ca^itings  and  bar  iron  of  the  proper  kind,  more  than  40,000 
do  lars  in  a  shoi  '  perifd  ha^*  been  sent  from  the  State,  which  should  natural- 
ly have  been  retained  and  expended  at  home.  The  manufacture  of  cordage 
and  powder,  in  mining  districts  or  the  more  valuable  metals,  are  also  lucra- 
tive There  is  ground  to  presume  that  North  Carolina  has  in  her  bosom 
other  mineral  treasures  than  gold  and  iron;  to  the  exploration  of  which  no- 
thn.g  can  more  effectually  contribute  than  the  introduction,  growth  and  dis- 
semination throughout  the  country  of  skilful  and  practical  as  well  as  scien- 
tific miners,  whose  eager  researches  for  the  precious  metals  may  lead  to  the 
discovery  ol  new  sources  of  wealth. 

Tnur  conimittee  refer  with  a  feeling  of  patriotic  exultation  to  the  present 
encouragement  to  keep  and  attract,  the  numerous  objects  of  profitable  em- 
ploymi^nt,  and  the  copious,  yet  various  means  of  supporting  a  numerous  po- 
pulation, now  presented.  An  extended  territory,  and  a  soil  suited  to,  and 
wc'i  rewarding  the  cultivation  of  freemen,  a  climate  exceedingly  mild,  yet 
needing  not  the  rudeness  of  northern  winters  to  make  it  salubrious;  forests 
of  timber  vast  enougl^  for  the  exigencies  of  future  generations;  bread  stuffs 
and  m^ats  cheap  and  abundant,  even  to  profusion,  and  no  necessary  or  sub- 
stantial comfort  of  life  deficient. 

Your  committee  cannot  doubt  of  the  expediency  of  continuing  the  impulse 
of  advancement  clearly  perceptible  in  our  State,  by  extending  a  liberal  and 
protecting  policy  towards  the  introduction  of  foreign  capital.  The  precious 
■aptals  can  never  glut  the  market,  nor  mining  for  them  be  overdone.  Every 
mining  establishment  is  of  important  utility  to  its  neighbor — not  a  jealous 
hurtful  competitor — and  when  it  is  considered  that  a  few  acres  of  mining 
possession  may  swallow  up  hundreds  of  thousands  of  dollars  for  develope- 
ment.  there  can  be  apprehension  of  monopoly  only  by  those  misapprehending 
ihj'  subject. 

The  great  decrease  of  the  supply  of  the  precioHs  metals  throughout  the 


world,  and  the  extraordinary  and  pervadiog  influeace  of  this  circumstaQa 

in  the  prices  and  dealings  of  the  whole  globe,  are  now  acknowledged,  M 
the  fact  has  become  not  the  least  noticeable  part  of  the  late  Presidenti 
Message.    To  the  States  having  gold  mines,  this  fact  is  pregnant  With  i 
portant  consequences,  which  your  committee  are  deterred  from  dncussin 
by  the  extension  of  their  report.  \ 

Your  commi  tee,  in  conclusion,  report  the  bill  to  the  House,  and  reco 
mend  its  passage  into  a  law. 

All  whkh  is  respectfully  submitted. 

WM.  J  .ALEXANDER,  Chairman. 


